Amfed Financial, Nevada's biggest thrift, sold the bulk of its nonperforming assets last week, cleaning up the one blot on its otherwise stellar record.
Amfed, the holding company for $1.5 billion-asset American Federal Savings Bank, sold a 414-unit apartment complex in Reno for $12.2 million. That leaves the company with just under $4 million in nonperforming assets.
Amfed chief executive E.R. Houston said the borrower on the property had been in bankruptcy for several years.
"The . . . properties have been a problem for over two years," he said. "Now we can start 1995 with a reduced amount of nonperforming assets. We're in awfully good shape."
It was a two-part deal, with one buyer paying $10.4 million in cash for 350 units and another paying $1.8 million, 60% financed by American Federal, for the other 64 units.
Mr. Houston said the company is continuing to work on the sale of another $1.8 million in properties affected by the same bankruptcy.
Amfed is getting rid of the properties at an opportune time. After two acquisitions last year - Home Federal Bank in Reno and First Western Bank, which doubled its asset size - American Federal is putting its mortgage lending operations to work in one of the country's fastest-growing economies.
The 105-year-old portfolio lender "religiously" avoided exotic securities and the Southern California real estate in recent years, Mr. Houston said. And, despite the bankrupt apartment complex, he said the thrift has not turned away from multifamily lending. American Federal is seeking to expand its lending to the north, particularly in Idaho.
The thrift originated or purchased $296.8 million of loans in the first nine months of 1994, compared with $188.4 million during the same period in 1993.
The company raised $68 million in a community stock offering in 1992. It trades on Nasdaq under the symbol AMFF.
For the first nine months of 1994, it earned 1.26% on assets but only 9.82% on equity, not surprising given its hefty 9% tangible capital ratio.